Tax Q&A for Recently Divorced People

By Robert D. Bordett, CFP®, CDFA®
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November 28, 2017

Advisors, you’re likely aware from experiences with clients that divorce is one of the most painful experiences anyone can go through. In addition to the emotional component, financial issues weigh heavily on the minds of the parties to any divorce.

Unfortunately, there are just some things that don’t follow any logic and you just have to know. Here are a few of the most common tax questions for recently divorced couples:

What filing status options do I have if I am separated from my spouse?

You may qualify as Head of Household if you and your spouse lived apart for the last 6 months of the year, and you pay more than half the cost of keeping up a home for your child who lives with your more than 6 months.

What government entities do I need to notify when I get divorced and how do I notify them?

Report any name changes as a result of your divorce. If you took back your maiden name, for example, notify the Social Security Administration. You can go to your local SSA office or change it online at their website.

Make sure you do this before you file your tax return to avoid problems.

Will I pay less tax if I file jointly or separately?

In most cases, you pay less filing jointly, but there are times when using the married filing separately status can be better.

Do I have to pay tax on Alimony and child support payments I receive?

You will pay tax on the alimony you receive. You do not pay tax on child support payments you receive.

There are many more random things to know when it comes to divorced couples and finances, so please feel free to contact me with your questions.

Author Bio

Financial advisors face few challenges as emotionally charged and potentially difficult as clients trapped in family conflict. Just ask Robert D. (Bob) Bordett. Whether it’s marital separation or divorce, the care of elderly family members or death and estate settlement, an advisor’s knowledge of a client’s finances is never enough; industry professionals must be able to help families set conflict aside, seek agreement and preserve valuable assets. A Certified Financial Planner and Certified Divorce Financial Analyst, Bob Bordett has devoted much of his career guiding couples, families and business partners through difficult situations to arrive at fair and practical solutions. As Senior Vice President of Atlanta’s Consolidated Planning Corporation, Bob specializes in mediation, collaborative divorce, divorce planning and financial planning. He maintains a private practice, Collaborative Practice and Mediation Services, Inc., applying Alternative Dispute Resolution methods while serving as a financial neutral. Bob is also a Registered Mediator and Arbitrator with the Georgia Commission on Dispute Resolution. A recognized expert on financial issues impacting divorce, Bob has published widely, appeared on CNN, spoken at a variety of conferences and led seminars across the country. He has held leadership positions in a number of industry associations including the International Academy of Collaborative Professionals, the Institute of Certified Financial Planners and the Family Mediation Association of Georgia. He is a founding member of the Academy of Professional Family Mediators and serves on the board of the Professional Mediation Board of Standards. But perhaps most importantly, Bob brings genuine compassion, commitment and a desire for positive outcomes to every client’s unique circumstances. Bob frequently partners with Marsha Schechtman, LCSW, who brings a deep understanding of family dynamics plus expertise in communication strategies to her work. For a representative list of Bob’s speaking topics, please visit the Speaking page under the Services section.